15.6% Return in 9 weeks
Once again I utilized the Stock-Trak website to track my stock-picking performance over a 10-week timeframe (though somehow this challenge came out to be 9-weeks). Not only was I competing against myself and the S&P 500 Index, but also against 175 other virtual investors! No matter, I came away yet again soundly trouncing the S&P 500, with a 15.6% return in 9-weeks! The kicker was, this time I limited myself to only investing in undervalued securities with some ties to the healthcare sector.
I have updated the Historical Portfolio Performance data in the toolbar to your immediate right, to show the new data. This now includes data for the Fall 2005 Performance, Winter 2006 Performance, and new Summer 2006 Performance, as well as a new comparison of the Summarized Total Performance for the three competitions.
Just in case you're a little suspicious, here is a look at the actual ending graph generated by Stock-Trak: 2006 Summer Stock-Trak Challenge.
I know some of you are just dying to see which undervalued healthcare securities I invested in, so without further ado, the ending portfolio allocation, for the Summer 2006 challenge.
You too can get performance like this, and the best way to start would be to rifle through some of the recommended books in the previous post. However, the quickest path to success would be to start with The Little Book That Beats the Market, then head over to The Magic Formula , try out some screens, and utilize Benjamin Graham's good ol' The Intelligent Investor to investigate your newfound companies some more...
Enjoy!
Labels: Portfolio Performance









2 Comments:
Hi,
I highly recommend Greenblatt book “The little book that beats the market’. Personally I differentiate from the books ‘advice’ to pick stocks randomly out of the selection. I believe with knowledge of businesses an more specific: on durable competitive advantages) one could select the most promising ones, which will lead to additional returns (this is the way Greenblatt uses the screen himself).
I have written some revealing reports on how to know which stocks to select: www.magicformulastocks.com Also in these reports I give clues on further ways of generating extra return (the reports are for free).
Success in investing,
Hendrik Oude Nijhuis
www.magicformulastocks.com
Yes, I agree that randomly picking stocks out of his Magic Formula may work, but there are better ways to tighten the methodology and focus on specific areas, especially if you are proficient in a specific industry.
One extra ratio that I like to apply to The Magic Formula, in addition to Greenblatt's earnings yield and return on capital, is the debt/equity ratio...
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